The Company and Corporation hereby hire Employee to perform, and Employee agrees to perform, the following services (the “Services”) during the Term (as defined below), for and to the benefit of the Company and Corporation (the “Engagement”):
Transitioning a permanent Chief Financial Officer (“CFO”) of the Company and Corporation;
Overseeing financial and risk management operations of the Company and Corporation;
Overseeing reporting of financial results;
Advancement of the Company’s and Corporation’s strategic objectives; and
Other services as reasonably requested by the Chief Executive Officer of the Company and Corporation or the Board of Directors of the Company (the “Board”).
Employee agrees that proper performance of the Services will require substantially all of his business time, and accordingly Employee shall not work on any engagement other than the Engagement during the Term, other than the positions set forth on Exhibit A.
During the Term, Employee shall be an employee and an officer of each of the Company and Corporation with the title “Interim Executive Vice President, Chief Financial Officer” of each of the Company and Corporation.
Employee shall perform the Services at the Company’s headquarters and other Company locations, and shall observe all rules, policies and practices of the Company and Corporation, including but not limited to the Statement of Business Ethics.
Salary. As consideration for the Services, the Corporation shall compensate Employee at the rate of $65,000 per month (the “Monthly Salary”) during the Term (prorated for any partial months).
Bonus. The Employee shall be eligible for a Bonus in the amount of $10,000 per month, which shall be prorated daily for any partial month and which, except as otherwise provided herein, shall be payable as a lump sum within 30 days following the Termination Date (as defined below). The Bonus amount will be forfeited if the Employee voluntarily terminates employment or is terminated for Cause (as defined below). If the Employee is involuntarily terminated for reasons other than Cause, the Employee will receive a prorated Bonus based on the number of months of employment, prorated daily for any partial months. The Bonus amount will be payable to the Employee in lieu of participation in the Management Incentive Compensation Program or any other performance-based bonus program offered by the Company or Corporation.
Additional Stipend. In recognition of certain compensation that the Employee will be foregoing as a result of the Engagement, the Employee will be entitled to receive a stipend in the amount of $5,417 per month during the Term of this Agreement, which shall be payable as a lump sum within 30 days following the Termination Date. This stipend will be nonforfeitable and prorated daily for any partial months.
The Corporation shall reimburse the Employee for all documented out-of-pocket business expenses reasonably incurred during the Term in connection with the provision of the Services in accordance with the Corporation’s standard policies and procedures.
Without limiting the foregoing, the Corporation shall reimburse the Employee for the following out-of-pocket expenses reasonably incurred during the Term in connection with Consultant’s temporary residence in the Dallas, Texas metropolitan area (the “temporary relocation benefits”): (i) temporary rental of a furnished apartment in Plano, Texas or the surrounding geographic area not to exceed $5,000 per month; and (ii) rental car, airfare, and other commuting expenses (including meals) collectively not to exceed $4,000 per month. Any such expenses paid under this section shall not be grossed up for applicable taxes by the Corporation.
All expense reimbursement, including the temporary relocation benefits, will be subject to the Corporation’s expense reimbursement policies as the same are in effect from time to time.
Benefits. As an employee of Corporation, the Employee shall be eligible for the standard benefits that are generally made available to all employees of the Corporation.
Representations. Employee represents and warrants that (i) he has the right, power and authority to enter into this Agreement and to perform fully all of his obligations hereunder and (ii) his execution, delivery and performance of this Agreement and the performance of the Services by Employee do not, and will not, conflict with or result in any breach or default under any other agreement of Employee and any third parties.
“Affiliate” means, with respect to any entity, any other corporation, organization, association, partnership, sole proprietorship or other type of entity, whether incorporated or unincorporated, directly or indirectly controlling or controlled by or under direct or indirect common control with such entity.
Employee’s (i) conviction of a felony or (ii) plea of nolo contendre in connection with any financial, business or commercial enterprise or transaction or any other matter (excluding traffic offenses);
Employee becoming the subject of a criminal indictment or other regulatory proceeding initiated by the Securities and Exchange Commission or other federal or state regulatory body having oversight for financial institutions in any such case based on material allegations of improper conduct or activities involving (i) securities trading, (ii) inaccurate disclosure or reporting, or (iii) other financial matters, in each case that in Corporation’s opinion could adversely affect the business or reputation of Company or the Corporation, or that could otherwise materially disrupt the business affairs of Company or the Corporation as determined in accordance with Exhibit B;
Employee’s material violation of law in connection with any transaction involving the purchase, sale, loan or other disposition of, or the rendering of investment advice with respect to, any security, futures or forward contract, insurance contract, debt instrument or currency;
Employee’s dishonesty, bad faith, gross negligence, willful misconduct, fraud or willful or reckless disregard of duties in connection with the performance of Services;
Employee’s material breach of this Agreement, to the extent not cured to the satisfaction of Company or the Corporation within five days after the date of notice of such breach (to the extent susceptible to cure), or Employee’s material breach of any other agreement with the Company, Corporation, or any of their respective Affiliates;
Employee’s material violation of the written policies adopted from time to time by the Company or Corporation governing generally the conduct of persons performing services on behalf of the Company, Corporation, or any of their respective Affiliates, to the extent not cured to the satisfaction of the Company and Corporation within five days after the date of notice of such violation (to the extent susceptible to cure);
Employee’s intentional taking of any improper action or the intentional omission to take any proper action or omission to take any action that has caused or substantially contributed to a material deterioration in the business or reputation of the Company, Corporation, or any of their respective Affiliates, or that was otherwise materially disruptive of the business affairs of the Company, Corporation, or any of their respective Affiliates, provided, however, that the term Cause shall not include for this purpose any mistake in judgment made in good faith or any act or omission taken at the express or affirmative direction, or otherwise with the express affirmative approval, of the Board; or
Employee’s obtaining of any material improper personal benefit, including as a result of a breach of any covenant or agreement in connection with the provision of the Services.
“Disability” means any physical or mental illness, disability or incapacity of Employee that prevents Employee from performing all or substantially all of the Services as contemplated by this Agreement that continues for 30 consecutive days.
“Expiration Date” means the earliest to occur of:
30 days following the start date of the Company or Corporation’s permanent Chief Financial Officer; or
The 180th day following the Effective Date, subject, in the case of this clause (ii), to automatic, consecutive 30-day extensions at the end of such period or extension (as applicable), unless the Company or Corporation on the one hand, or Employee on the other, elects, upon not less than 30 days’ advance written notice to the other, for any such extension not to apply.
“Term” means the period from the Effective Date through the Termination Date.
“Termination Date” means the Expiration Date, or if earlier, the date of termination of the Engagement pursuant to Section 3.2 or 3.3 or otherwise.
“Work Product” means all patents and patent applications, all inventions, innovations, improvements, developments, methods, designs, analyses, drawings, reports, creative works, discoveries, software, computer programs, modifications, enhancements, know-how, formulations, concepts and ideas, and all similar or related information (in each case whether or not patentable), all copyrights and copyrightable works, all trade secrets, confidential
The Company or Corporation may terminate the Engagement immediately:
for any reason other than described in Sections 3.2(a)(i) and (ii) above.
Termination by Employee. Employee may terminate the Engagement prior to the Expiration Date upon:
the Company’s or Corporation’s material breach of this Agreement, to the extent not cured within fifteen days after the date of notice of such breach (which notice must be given within fifteen days of such breach) and failure to cure such breach (to the extent susceptible to cure).
absent the promises and representations of Employee in this Section 4.1 and Section 4.2 below, the Company or Corporation would require him immediately to return any tangible Confidential Information in his possession, would not provide Employee with new and additional Confidential Information, would not authorize Employee to engage in activities that will create new and additional Confidential Information, and would not enter or have entered into this Agreement; and
Non-compliance with the disclosure provisions of this Agreement shall not subject Employee to criminal or civil liability under any federal or state trade secret law for the disclosure of a Company trade secret: (i) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney in confidence solely for the purpose of reporting or investigating a suspected violation of law; (ii) in a complaint or other document filed in a lawsuit or other proceeding, provided that any complaint or document containing the trade secret is filed under seal; or (iii) to an attorney representing Employee in a lawsuit for retaliation by the Company for reporting a suspected violation of law or to use the trade secret information in that court proceeding, provided that any document containing the trade secret is filed under seal and Employee does not disclose the trade secret, except pursuant to court order.
Invention Assignment. Employee hereby assigns to the Company and Corporation all right, title and interest to all Work Product that (a) relates to the Company’s or Corporation’s actual or anticipated business, research and development or existing or future products or services, or (b) is conceived, reduced to practice, developed or made using any equipment, supplies, facilities, assets, information or resources of the Company or Corporation (including, without limitation, any intellectual property rights). Employee shall promptly disclose Work Product to the Company and Corporation and perform all actions reasonably requested by the Company and Corporation (whether during or after Employee’s period of Services) to establish and confirm the ownership and proprietary interest of the Company and Corporation in any Work Product (including, without limitation, the execution of assignments, consents, powers of attorney, applications and other instruments). Employee shall not file any patent or copyright applications related to any Work Product except with the Company’s or Corporation’s written consent.
Remedies. Employee acknowledges and agrees that the Company and Corporation would not have an adequate remedy at law and would be irreparably harmed if any of the provisions of Article IV of this Agreement were not performed in accordance with their specific terms or were otherwise breached. Accordingly, Employee agrees that the Company and Corporation shall be entitled to equitable relief, including preliminary and permanent injunctions and specific performance, if Employee breaches or threatens to breach any of the provisions of such sections, without the necessity of posting any bond or proving special damages or irreparable injury. Such remedies shall not be deemed to be the exclusive remedies for a breach or threatened breach of this Agreement by Employee, but shall be in addition to all other remedies available to the Company at law or equity. Employee acknowledges and agrees that the Company and Corporation shall be entitled to seek to recover its attorneys’ fees, expenses, and court costs, in addition to any other remedies to which it may be entitled, if he breaches this Agreement.
Nonsolicitation of Employees and Consultants. The Employee hereby covenants and agrees that during the term of this Agreement and for a period equal to twelve months thereafter, the Employee shall not, without the prior written consent of the Company and Corporation, on the Employee’s own behalf or on the behalf of any person, firm or company, directly or indirectly, attempt to influence, persuade or induce, or assist any other person in so persuading or inducing, any of the employees or consultants of the Company or Corporation (or any of its subsidiaries or affiliates) to give up his or her employment or consulting agreement with the Company or Corporation (or any of its subsidiaries or affiliates), and the Employee shall not directly or indirectly solicit or hire employees or consultants of the Company or Corporation (or any of its subsidiaries or affiliates) for employment with any other employer, without regard to whether that employer is a Competing Business, as that term is defined in Section 4.8(b).
Noninterference with Business Relations. The Employee hereby covenants and agrees that during the term of this Agreement and for a period equal to twelve months thereafter, the Employee shall not, without the prior written consent of the Company and Corporation, on the Employee’s own behalf or on the behalf of any person, firm or company, directly or indirectly, attempt to influence, persuade or induce, or assist any other person in so persuading or inducing, any person, firm or company to cease doing business with, reduce its business with, or decline to commence a business relationship with, the Company or Corporation (or any of its subsidiaries or affiliates).
The Employee covenants that during the term of this Agreement, and for a period equal to twelve months thereafter, the Employee will not, except as otherwise provided for in this Section 4.8, undertake any work for a Competing Business, as defined in Section 4.8(b).
As used in this Agreement, the term “Competing Business” shall specifically include, but not be limited to:
Amazon.com, Inc.; Burlington Stores, Inc.; Kohl’s Corporation; Lowe’s Companies, Inc.; Macy’s, Inc.; Ross Stores, Inc.; Target Corporation; The TJX Companies, Inc.; Walmart Inc., and any of their respective subsidiaries or affiliates, or
any business (A) that, at any time during the twelve month period following this Agreement, competes directly with the Company or Corporation through sales of merchandise or services in the United States or another country or commonwealth in which the Corporation, including its divisions, affiliates and licensees, operates, and
any business that provides buying office or sourcing services to any business of the types referred to in this Section 4.8(b).
For purposes of this Agreement, a Competing Business shall not include (A) any business on whose board of directors the Employee served during the twelve-month period preceding the Effective Date of this Agreement or (B) any business that the Company, upon the request of Employee, determines, in its sole discretion, is not engaged in material competition with the Company or Corporation.
For purposes of this section, the restrictions on working for a Competing Business shall include working at any location within the United States or Puerto Rico. Employee acknowledges that the Company and Corporation is a national retailer with operations throughout the United States and Puerto Rico and that the duties and responsibilities that the Employee performs, or will perform, for the Company and Corporation directly impact the Company and Corporation’s ability to compete with a Competing Business in a nationwide marketplace. Employee further acknowledges that Employee has, or will have, access to sensitive and confidential information of the Company and Corporation that relates to the Company and Corporation’s ability to compete in a nationwide marketplace.
Waiver of Contractual Right. Failure of any party to enforce any provision of this Agreement shall not be construed as a waiver or limitation of that party’s right to subsequently enforce and compel strict compliance with every provision of this Agreement.
Entire Agreement. This Agreement, together with any other documents incorporated herein by reference and related exhibits and schedules, constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, with respect to such subject matter.
Notices. All notices required or permitted under this Agreement shall be in writing and shall be deemed delivered when delivered in person or deposited in the U.S. mail, postage prepaid, or transmitted via facsimile or electronic mail addressed as follows:
Corporation’s Right of Offset. If the Employee is at any time indebted to the Company or Corporation, or otherwise obligated to pay money to the Company or Corporation for any reason, to the extent exempt from or otherwise permitted by section 409A of the Code and the Treasury regulations thereunder, including Treasury Regulation section 1.409A-3(j)(4)(xiii) or any successor thereto, the Corporation, at its election and following written notice, may offset amounts otherwise payable to the Employee under this Agreement, including, but without limitation, the Monthly Salary or the Bonus, against any such indebtedness or amounts due from the Employee to the Company or Corporation, to the extent permitted by law.
Counterparts. This Agreement may be executed in two or more counterparts, including by electronic or facsimile transmission, each of which shall constitute an original, but when taken together, shall constitute a single instrument.